1. How does Dippin Dots business level strategy allow the firm to protect itself from the effects of the five competitive forces? Provide an example of a way that this strategy protects the company from the effects of the five forces: Identify the specific force and provide one example of how Dippin Dots strategy insulates the firm from the effects of that force.
2. What potential or real risks does the firm take in pursuing this strategy? Identify two ways that Dippin Dots faces any of the risks associated with pursuit of a cost leadership strategy.
CASES CASE 10 DIPPIN' DOTS: IS THE FUTURE FROZEN? was a fun and unique way to commemorale the versary of National Ice Cream Month.” said Jones The company had launched the Monster Munch. K Corn Dippin Dots, and Dinner Dots ice cream n 2014. The Monster Munch line included eight mon themed flavors with what the company called “ctary t vors, crazy names and some crazy ingredients whin th Dinner Dots line included dotsize portions of five a Dippin' Dots has produced and distributed its tiny flash frozen beads of ice cream, yogurt, sherbet, and flavored ice products since microbiolorist Curt Jones invented the cryogenic process in 1988, Available in many tastes and types-Original Dots, Dots 'n Cream. Coffee, and Dot Treats-Dippin' Dots' innovative take on frozen food has changed some portion of the public's way of looking at ice cream. Made at the company's production facility in Paducah, Kentucky, Dippin Dots' unique frozen products are distributed in all 50 states and 11 countries The company promoted the low cost of entry and fe ibility of its franchising options. In an interview with C Money, Steve Rothenstein, Dippin' Dots director of fre chising, said the company had a lot of opportunities to s a variety of business models. With a franchine starva of only $15,000, the company offered an economic ops for budding entrepreneurs. Dippin' Dots was flexible with alternative delivery mol els in addition to its more traditional brickandmon locations. These included kiosks at malls and carts at cn munity events (e.g., fairs and festivals), What remained to be seen was whether all these ab meals At the beginning of 2017, Dippin' Dots had experi enced a steep increase in total sales and was involved in numerous lucrative developments. Since being acquired by Fischer Enterprises in 2012, Dippin' Dots had pursued a multi-pronged distribution strategy of establishing partner- ships with other renowned amusement destinations such as Philadelphia Zoo, Chuck E Cheese, and several premier parks. The new distribution strategy also included a part nership that involved co-branding between Dippin' Dots and Doc Popcorn, which increased the product presence in nearly 7,000 convenience stores around the U.S. Many challenges remained, however, for the company to expand tages, innovations, and fixes would have a lasting impuc on reversing the softness in company revenues and he financials a much needed boost. Were these enhanceme to the product portfolio, promotions, and business e sion efforts clever ways of growing the business, or in last-ditch effort before the end? Despite the introduction d innovative new products, record-setting promotional evet and enticing franchise expansion opportunities, the fut of the company remained uncertain. internationally and achieve organic growth instead of struc- turing partnership and co-branding contracts. The company was bailed out of bankruptcy in 2012. There seemed a lot of potential to grow Dippin' Dots at that time. The vision and creativity of the company founder and CEO, Curt Jones, appeared to be complemented perfectly by the business acumen and experience of its president, Scott Fischer 2 Recently, Dippin' Dots had added five new franchises within the U.S., increasing the total number of franchises from 130 in 2015 to 135 in 2016. However, the number of Dippin' Dots U.S. franchises was not growing steadily, and the number of international franchises remained stagnant. A year earlier, Dippin' Dots had celebrated the 30th anniversary of National Ice Cream Month by attempting to set a new world record in the world of ice cream. Dippin Dots, the maker of the iconic flash-frozen ice cream and Company Overview In May 2012, Dippin' Dots LLC, a newly formed con pany based in Oklahoma and funded by private capial acquired the Paducah, Kentucky-based Dippin' Dots ls A motion to approve the proposed sale was filed in April 2012 in the U.S. Bankruptcy Court in Louisville, Kentucky In November 2011, Dippin' Dots Inc. had filed for Chaptr 11 bankruptcy protection in federal court in Kentucky fir a combination of reasons, including owing millions to le ers from costly patent litigation, as well as having increae operating costs and plummeting sales. Despite its uni twist on the classic frozen novelty, prior to the acquistiot Dippin' Dots had been encountering abysmal revenues frozen treats, achieved a Guinness World Record title for the number of ice cream cups prepared by a team of five in three minutes. Curt Jones, Dippin' Dots' founder and CEO, was part of the record-setting team. “Our record attempt having trouble maintaining attention in the market. Feeling This case was prepared by Professor Alan B. Eisner of Pace University and graduate stadent Brian R. Callahan and Saad Nazir of Pace University as a basis for class discussion rather than to ilustrate either effective or ineffective handling of an administrative situation. Copyright 2017 Alan B. Eisner July was designated National Ice Cream Month by the US. governmt 1984 C58 CASE 10:DIPPIN' DOTS: IS THE FUTURE FROZEN? the pressure. the company had looked to innovativs sew de bope for a turnaround. In the bankruptcY filing, the pofucts promotions, and business-expansion efforts as beewing, or blended with Frapee beads to make a Dippin Dots Frappe. Jones's once kidtargeted dots sow had a very adult twist company listed about $20.2 million in assets and more than $12 million in liabilities.” The acquisition was appeoved For years Jones had been thinking of coming out with low- shortly after Dippin Dots employed approximately 170 workers at its acility in Paducah, Kentucky, and Scott Fischer, president be sold at the schools. The result was “Chillz.” a lower of Dippin Dots LL.C, had no particular plan to moNe the acility or let go any existing employees. Dippin' Dots LLC was unaffiliated with the existing Dippin' Dots Inc. entity Jones was thinking about more kid-friendly treats, too. calorie, low-lat Dippin Dots that could meet the nutritions requirements and regulations set by public schools and thus. calorie alternative to ice cream. Dippin Dots Chillz was a low-at frozen-beaded dessert made with Truvia, an all- natural sweetener. This healthier alternative to ice creame was also an escellent source of vitamin C. It was avail- able in three flavors: Sour Blue Razz. Wango Rainbo, and Chocolate. In the words of Dippin' Dots' vice president of sales, Michacl Barrette Fischer said: We are looking forward to working with the Dipein Dots manapement team and employees to masimizs be ceportunity of the business and realize the company's grOwth potential in a global market. We are committed to ensuring that Dippin' Dots reclaims its status, not as a novelty of the pasL but as the ice cream of the future. This transaction has become a very equitable solution to the parties involved, and we expect a very smooth transition 5 We're starting to distribute Chiltz through the vending channel We already have two contracts under way and expect to get more. Vending companies know and love the Dippin Dots brand With Chillz and other peoducts, it's a great opportunity for them. Schools meed that rewenue. They've thrown out a lot of peoducts in recent times that have no nutritional value. So wes feel bullish about Chilla Fischer said they had taken the opportunity to acquire Dippin' Dots Inc, in order to rescue the frozen novelty and keep it afloat. Fischer added: We are looking forward to rolling up our sleevs and personally meeting with all of the employees franchisees, and business associates of the company and moving forward in a very stable and produuctive manner. We see substantial value in the Dippin Dots brand, one of the most wellknown brand names in the retail market. An Innovative Product The company's chief operation was the sale of BBsized pel lets of flash-frozen ice cream in some twodozen flavors to franchisees and national accounts throughout the world. As a Six Flags customer commented. “I gotta say, man, they're pretty darn good…. Starts off like a rock candy but ends up like ice cream. Dippin' Dots was the product of a marriage between old-lashioned handmade ice cream and space-age technol ogy. Dippin' Dots were tiny round beads of ice cream made at super-cold temperatures, served at subzero temperatures. in a soufflé cup, and eaten with a spoon. The super-coldi freezing of Dippin' Dots ice cream, done by liquid nitro- Showing their enthusiasm for growth, in January 2013 Fischer and the new executive team decided to invest over $3.1 million in the company's home facility in Kentucky expanding operations and creating 30 new fullkime jobs Prior to the expansion, of Dippin' Dots' 170 workers, 60 lived in the Paducah area. Fischer stated, “This investment gen, cryogenically locked in both flavor and freshness in a way that no other manufactured ice cream could offer. The process virtually eliminated the presence of trapped ice and air, giving the ice cream a fresh flavor and a hard texture. Not only had Jones discovered a new way of making ice underscores our long-term commitment to market the wonderful Dippin' Dots brand, introduce new products to complement existing ones, and maintain the historic ties to Kentucky. Other improvements were to include purchas- ing energy-efficient equipment, upgrading processes, and cream, but many felt his product was more flavorful and renovating the facility. Earlie Dippin' Dots had expanded its product line ated a way…[to] get a quicker freeze so the ice cream from ice eams to uniquely brewed coffees. Founder Curt Jones t a colderthan-cold instant-freezing process, Idecided to quit my job and go into business. Similar the one that made Dippin' Dots ice creams so delectab and redirected that technology to fresh-brewed expertise in cryogenics. His first job was researching and coffee. as he had dubbed Dippin' Dots the “Ice Cream engineering as a microbiologist for ALLtech Inc., a bioengi- of the Fe two decades earlier, he said the new “coffee neering company based in Lexington, Kentucky. During his dots” wor adopt the slogan “Coffee of the Future.” Real days at ALLtech, Jones worked with different types of bac- spressoas made from fresh, high-quality arabica beans and ther ash-frozen into dots immediately, capturing the be transported throughout the world. He applied a method avor and aroma. Named “Forty Below Joe edible coffee,” the coffee dots could be eaten with a spoon, heated with water and milk to make a hot “fresh-brewed” coffee without richer than regular ice cream. According to Jones, “I cre- wouldn't get large ice crystals. … About six months later, Jones was a microbiologist by trade, with an area of teria to find new ways of preserving them so that they could of freezing using super-cold temperatures with substances such as liquid CO, and liquid nitrogen-the same method he later used to create Dippin' Dots. DIPPIN' DOTS: IS THE FUTURE FROZENT c59 CASE 10 One process Jones developed was “microencapsulating” Industry Overview the bacteria by freezing their medium with liquid nitrogen Other scientists thoughht he was crazy, because nothing like that had ever been done before. Jones, however, was convinced his idea would work, He spent months trying to perfect the process and continued to make progress. While Jones was working over 80 hours a week in ALLtech's labs to perfect the microencapsulating process, he made the most influential decision of his life. He took a weekend off and attended a family barbeque at his parents bo It just so happened that his mother was making ice cream the day of the barbeque. Jones began to reminisce about homemade ice cream prepared the slow, old-fashioned way Then Jones wondered if it was nossible to flash-freeze ice cream. Instead of using a bacteria medium, was it possible to microencapsulate ice cream The answer was yes. After virtually reinventing a fro- zen dessert that had been around since the second century The frozen dairy industry has traditionaly boen by family-owned businesses such as Dippin Dots dairies, and a couple of large international compatie focus on only a single sales region. The year 206 w tively flat year for the production and sale of ice c volume in traditional varieties remained at and of ice cream emerged. Despite highet ingredent manufacturers were continually churning out new pubu though at a slower rate than in the previous year Nev ucts and varieties range from super-premium veledions good-for you varieties to cobranded packages and so Most novelty ice creams can be found together in upe ket freezer cases, in smalll freezers in convetienot and in carts, kiosks, or trucks at popular wammerin events. Ice cream makers have been touched by coni tion trends affecting the overall food and beverage indute that extend beyond their products, as even the bis have been folded into global conglomerates The ice cream segment in the United States is ab ground for two huge international consumer-produd n panles seeking to corner the ice cream market. Thoe w industry giants are Nestlé SA of Switzerland, the wold largest food company, with more than $88 billion in au sales, and Unilever PLC of London and Rottendam w over $53 billion in annual revenues. Both have been ing into US, firms for quite a while, but Nestie, vhe already owned the Häagen-Dazs product line, upel ante with its June 2003 merger with Dreyer's Grand E loe Cream Ine, of Oakland, California. But even as the giants dominate the U.S. ice cream industry, abou t small businesses continue to produce and distribute f treats. As one commentator has said. “Like micb ers and small-scale chocolate makers, entrepreneun drawn to ice cream as a labor of love. Some of the ht known brands are regional ones, such as Blue Bell, baset Brenham. Texas (see Exhibit 1). Approximately $54 billion was spent on ice cran s 2016. lce cream and related frozen desserts are consume by more than 90 percent of households in the Uni States.6 Harry Balzar, of the market research firm N BC, Jones patented his idea to flash-freeze liquid cream, and he opened the first Dippin Dots store.2 Once fran- chising was offered in 2000, the “Ice Cream could be found at thousands of shopping malls, amusement parks, water parks, fairs, and festivals worldwide. Dippin Dots ice cream was transported coast to coast and around the world by truck, train, plane, and ship. In addition to being transported in specially designed cryogenic transport containers, the product was transported in refrigerated boxes known as pallet reefers. Both types of containers ensured fast and efficient delivery to franchisees around the world. The product was served in 4, 5, and 8-ounce cups and in 5-ounce vending prepacks the Future” Product Specifics Dippin' Dots flash-frozen beads of ice cream typically are served in a cup or vending package. The ice cream averages 90 calories per serving, depending on the flavor, and has 9 grams of fat. The ice cream is produced by a patented pro- cess that introduces flavored liquid cream into a vat of nega- tive 320 degree liquid nitrogen, where it is flash-frozen to produce the bead or dot shape. Once frozen, the dots are col lected and either mixed with other flavors or packaged sepa- rately for delivery to retail locations. The product has to be Group, said about ice cream in general, “It's not a sm stored at subzero temperatures to maintain the consistency of the dots. Subzero storage temperatures are achieved by utilizing special equipment and freezers supplemented with dry ice. Although storage is a challenge for international shipping, the beads can maintain their shape for up to 15 days in their special containers. To maintain product integ- rity and consistency, the ice cream has to be served at 10 to 20 degrees below zero. A retail location has to have special Edy's/Dreyer's, Brevers, and Häagen-Dazs have all c storage and serving freezers. Because the product has to be stored and served at such low temperatures, it is unavailable and “light” products are seeing increased sales.” in regular frozen-food cases and cannot be stored in a typi- category, but one that has remained flat for more thn decade, and is not likely to grow” The challenge for p ducers is to woo customers away from competitors and s tain a loyal fan base by continuing to innovate. The te toward more healthy treats has spurred the major plyes Nestlé and Unilever, to develop reduced-lat prodact l that still have the taste and texture of fall-fat ice cra ued to experiment, and the “slow churned.,” “doublec cal household freezer. Therefore, it can be consumed only at scoop shop is the “slab” concept. Employees at franchie such as Marble Slab Creamery and Cold Stone Cre A novelty product delivery system in the indepe or near a retail location, unless stored with dry ice to main- tain the necessary storage temperature. work ingredients on a cold granite or marble slab so bi C60 CASE 10 DIPPIN DOTS: IS THE FUTURE FROZEN? EXHIBIT 1 Top 10 Ice Cream Brands, 2016 Private label Breyers 1.1285% Ben& Jerry's 499 1 Haagen-Dazs 465.4 Wels Blue Bunny 4188 284 2 Dreyer's/Edy's Grandi 2515 Dreyer'Edy's Siowchurned 2493 Turkey Hill 238.7 Blue Bell 222.4 Other Unilever Bestfoods North America 207.2 0 200 400 600 Sales in million U.S. dollars 800 1000 1200 Soupe Statistice 2017 premium ice cream with the customer's choice of tasty Industry Segmentation itives, such as crumbled cookies, fruits, and nuts, before serving it in a cup or cone. The novelty is the entertain- ment of watching the preparation. Both chains rank in Entrepreneur's list of the top 500 franchise opportunities, hut commentators are skeptical of their sustainability once the novelty wears off, especially since the average price is Frozen desserts come in many forms. Each of the following foods has its own definition, and many are standardized by federal regulations 22 Ice cream consists of a mixture of dairy ingredients such as cream, milk, and nonfat milk, and ingredients for sweetening and flavoring, such as fruits, nuts, and chocolate chips. Functional ingredients, such as stabilizers and emulsifiers, are often included in the product to promote proper texture and enhance the eating experience. By federal law, ice cream must contain at least 10 percent butterfat before the addition of bulky ingredients, and it must weigh a minimum of 4.5 pounds to the gallon. $5 for a medium serving. Kona Ice, shaved ice with a wide range of flavors, was among the popular ice cream brands of 2017. The com- pany's primary selling points are 814 decorated shaved ce cream trucks that entertain customers with colorful characters and tropical music while serving ice cream. Kona Ice franchisees own trucks that they bring to social events, schools, sports events and other community groups. Interestingly, Kona Ice experienced steady growth from the start of the company in 2008 and ranked 127th on Entrepreur's Franchise 500 list of 2017.30 Another prominent participant in the ice cream indus- try is Y rtland Franchising Inc. Started in 2006, the Califorr ased company offers 16 flavors of frozen yogurt along w 33 toppings, Customers are charged the price of Iroze yogurt by the ounce. Yogurtland has been grow- at anificant rate by expanding the number of fran- chises in the U.S. as well as Venezuela, Australia, Thailand and Dubel. By 2017, the company had 326 franchises and ranked 184th on Novelties are separately packaged single servings of a frozen dessert, such as ice cream sandwiches, fudge sticks, and juice bars, which may or may not contain dairy ingredients. . Frozen custard or French ice cream must also contain a minimum of 10 percent butterfat as well as at least 1.4 percent egg yolk solids. .Sherbets have a butterfat content of between I and 2 percent and have a slightly higher sweetener content than ice cream. Sherbet weighs a minimum of 6 pounds to the gallon and is flavored with either fruit or other characterizing ingredients Entrepreneur's Franchise 500 list.2 DIPPIN DOTS: IS THE FUTURE FROZEN? C61 CASE 10 shows the growth of franchises for Dippin' Dots. Eahibi revenue and . Gelato is characterized by a intense flavor and shows oductos lists key corporate mi es. IS served in a semifrozen state. Gelato contains an Despite the company's initial success achie of Curt Jones and Dippin Dots did no perfected his ides flashf enlisted the Sweeteners, milk, cream, egg yolks, and rlavoring. wh ater ices are similar to sherbets. but they obstacles. Once Jone contei the ne quiescently frozen confection is a frozen novelty such as a water-ice novelty on a stick. Frozen yogurt consists of a mixture of dairy cream like many new entrepreneurs b support his endeavor. It was selling his product, and he had no protection for bis entir his family milk and nonfat milk, that have s well as ingredients for sweetening from compcl cle confronting Jones was the tes ingredients, such and flavoring He neede locate funding to accomplish his goals operty, and Dippin' Dots' Growth from Its Origins The growth of Dippin' Dots Inc. has been recognized in. the United States and the world by industry watchdogs as Inc magazine, which ranked Dippin' Dots as one for the patent to protect his intellectual needed seed money to start manufacturine ice crea once the patent was granted. At the same time U was perfecting the flash-freezing process for his Vene usiness Adminig into one that w manufacture ethanol. However, instead of using the farms produce the alternative fuel, Jones's parents t in 1996 and 1907 companies two years in a row number 4 on Entrepreneur magazine's 2004 list of the top 50 new franchise companies, and it achieved the 101st spot on Entrepreneur's Franchise 500 for 2004. In 2005 Dippin Dots ranked number 2 as a top new franchise opportunity (SBA) loan to convert the family out a fin and then a second, mortgage to help fund Jones Thus, Jones initiated the entire venture by self-funding b the end of 2009 r 93 on the Franchise 500 list. By tion on Entrepreneur's Franchise 500 list 24 And by 2017 Dippin' Dots had fallen to the 382nd position. Exhibit 2 turing facilities (a liquid nitrogen tank in his parents gurage company with personal and family assets, h to pay for only the Irom Jones's parents w some crude manu end EXHIBIT Dippin' Dots Franchise Growth Company Owne Foreign Franchises Canadian Franchises U.S. Franchises Year 13 120 2016 13 115 2015 13 1 116 2014 Source: www.entrepreneur.com. EXHIBIT 3 Dippin' Dots Revenue and Productivity Growth Total Employees Productivity(Revenue/Employee) Year Revenues (in millions) 170 $185,000 $34.80 2015 170 $185,000 $32.85 2014 170 $180,000 $31.26 2013 165 $175,706 $29.87 2012 170 $167,879 201 $27.70 180 $157,059 $26.70 2010 190 $188,333 $33.90 2009 190 $36.00 $189,474 2008 Source: www.privca.com/company/dippin-dots-ine, author estimates DIPPIN' DOTS: IS THE FUTURE FROZEN? C62 CASE 10 EXHIBIT 4 Dippin Dots Milestones 1988 Dippin Dots is established as a company in Grand Chain, nois 889 First amusement park account debuts at Opryland USA in Nahyille 1990 Production facility moves to Paducah, Kentucky. 1991 Dealer network is established for fair,festival, and commercial retail locations 1994 First international licemsee is set up Uapant 1995 New 32,000-square-foot production facility opens in Paducah Production faclity expands by 20.000 square feet, company earns spot on Inc. 500 Ist of fastest-growing private compenies in the 1997 LUnited States 2000 Dippin' Dots Franchising Inc. is established, and first franchise is offered, igation against competitors is initiated to protect patent Dippin' Dots enlists 30 new franchisees. Fronchise Times magazine ists Dippin Dots thind in the United States in number of ice 2001 cream franchise locations, behind Baskin-Robbins and Dairy Queen. Dippin' Dots Franchising Inc. achieves 112th spot on Entrepreneur magazine's Franchise 500 ist, ranks 69th on its list of the 2002 fastest-growing franchise companies, and is named the number 1 new franchise company Dippin Dots becomes a regular menu offering at McDonald's restaurants in the San Francisco Bay area Dicpin' Dots Franchising Inc. achieves 144th spot on Entreoreneur manazine's Franrhise S00 sst and number 4 on Entrepreneurs 2003ist of the top 50 new franchise companies. Dippin' Dots opens the Ansong manufacturing plant, 80 miles south of Seoul, South Korea Dicpin' Dots Franchising Inc. ranks number 4 on Entrepreneur's Top 50 New Franchise Companies list and achieves 101st spot on 2004 Entrepreneur magazine's Franchise 500 list. Curt Jones and Dippin Dots are featured on a segment of the Oproh Winfrey Show appearing in 110 countries. Dippin Dots is featured among the top 10 ice cream palaces on the Travel Channel. Curt Jones is quoted in Donald Trump's best-selling The Way to the Top (p. 131). International Dairy Foods Association names Dipoin Dots Best in Show for Dot Delicacies, Dippin Dots aso wins three awerds for 2005 package design. Dippin' Dots Franchising Inc. ranks number 1 on Fronchise Times magazine's Fast 55 list of the fastest-growing young franchises in the nation. Ice cream cake and ice cream sandwiches (Datwiches are introduced to launch the Dot Delicacies program Company leadership is restructured. Curt Jones becomes chairman of the board. Tom Leonard becomes president of Dippin' Dots 2006 Inc. Dots 'n Cream, conventional ice cream enhanced by beads of Dippin' Dots, is introduced for market testing in Kroger stores in the Midwest. The 200th franchisee begins operations 2007 Dippin' Dots is available in Colombia, and www.digpindots.com V.5 is launched 2009 Curt Jones returns to running the day-to-day operations of the firm. Dippin Dots slides to 175th on Entrepreneur's Franchise 500 list 2008 Dippin' Dots Franchising Inc. ranks 112th on Entrepreneur's Franchise 500 list Dippin' Dots has 3 million Facebook fans 2010 O May 18, 2012, the purchase of Dippin' Dots by Scott Fischer, president of Dippin' Dots LLC, is approved by US. Bankruptcy 2012 Court: Scott Fischer joins the team as president. November 4, 2011, Dippin' Dots files for chapter 11 bankruptcy O 2011 in' Dots enters Guinness World Records book for producing the largest number of ice cream cups with a team of five in alnutes. 2013 oin Dots begins distribution to pharmacies and convenience stores to increase access 2014 2016 in Dots teams up with the singer/songwriter Dawin for exclusive remix dessert. Source: Dippin Dots Inc. Undated. History www.dippindoes.com/more-infoyhistory.hem CASE 10 DIPPIN DOTS: IS THE FUTURE FROZEN? C63 Dippin' Dots seems to appeal more t0 youngers uct still has to have staying power as customers grow d He next had to open a store, and doing so required even hore money-money that Jones and his family did not have. They were unable to get the SBA loan because. while the product was novel and looked nromising, there was nos proof that it would sell. So Jones and his newly appointed CFO (his sister) went to an alternative lender who lent them cash at an exorbitant interest rate that was tacked on to the principal weekly if unpaid Now in possession of the seed money they needed, Jones and his family opened their first store. Its summer- Eime opening created a buzz in the community. The store was mobbed every night, and Dinnin' Dots was legitimized by public demand. With the inlux of cash, Jones was able to move his manufacturing operation from his family's garage into a vacant warehouse. There he set up shop and personally made flash-frozen ice cream for 12 hours every day to supply the store After the store had been operating for a few months the Joneses were able to secure small business loans from local banks to cover the expenses of a modest manufactur- ing plant and office. At the same time, Jones's sister made calls to fairs and other even products could be sold at them. Luckily for the Joneses, the amusement park at Opryland in Nashville, Tennessee, was willing to have Dippin' Dots as a vendor. Unfortunately. the first Dippin' Dots stand was placed in front of a roller vending machine at a theater the band rented in Orands As one individual commented, “How can this t continuing to call itself the ice cream of the fu the future is now, folks, and they have been guhing sorry excuse for ice cream off on me at amsenes u In 2002 McDonald's reportedly spent S12 miln advertising to roll out Dippin' Dots in about 250 e rants in the San Francisco area. Jones called the dcal ended” if it worked favorably for both frms. Howev 2007 Dippin' Dots was available only at a few McDondc franchises in southern California. Storage and tranp tion issues were problematic, and the price o the uct. 5 ounces for $5, was too steep for all but the Gnhe Dippin' Dots fans In other marketing efforts. Dippin' Dots ads we ning in issues of Seventeen and Nickelodeon magucn Additionally, Dippin Dots hired a Hollywood fen place its ice cream in the background of televsion w movie scenes, including the 2003 Cheaper by the Decmh 2002 the Food Network's Summer Foods: Unerapped ho cased Dippin' Dots as one of the most unique and oa est ice cream treats. N Sync member Joey Fatone onte a Dippin' Dots freezer for his home after seeing a Da and zoos since I was a little kid to learn whether Dippin' Dots Caterers also sought Dippin' Dots for their star dim A birthday party at the home of NBA star Shaquile ONe featured Dippin' Dots ice cream. Dippin Dots continun to pursue the celebrity word-of-mouth route by servings products at events such as the MTV awards and celeb coaster, and people generally did not want ice cream before they went on a ride. After a few unsuccessful weeks, Jones moved the stand and business picked up considerably Eventually, the Joneses were able to move to an inline loca- tion, which was similar to a store, where Dippin' Dots had its own personnel and sitting area to serve customers Through word of mouth, interest in Curt Jones and Dippin' Dots spread. Soon other entrepreneurs contacted Jones about opening up stores to sell Dippin' Dots. A deal Dippin' Dots has met with increased competition ership network was developed to sell ice cream to autho- rized vendors and provide support with equipment and marketing. During that time, Jones employed friends in cor- porate jobs. Dippin' Dots grew into a multimillion-dollar company with authorized dealers operating in all 50 states and internationally. The result was a cash inflow for Dippin' Dots fran- chising. A franchise location was any mall, fair, national account, or large family entertainment center. According to the franchising information in 2016, the initial franchise fee was $15,000, with an estimated initial investment rang- ing from $112,204 to $376,950. In addition, franchisees are charity functions. Dippin' Dots' sales come from approximately 13 be chisees. 90 percent of which have multiple loction out-of-home ice cream market. The major threats to Di Dots are other franchise operations, such as Ben & Jem Häagen-Dazs,, Baskin-Robbins, Carvel, Dairy Queen, n newco